Optical Cable (OCC) investor relations material

Executive summary

• Net sales for Q2 FY2026 rose 26.6% year-over-year to $22.2 million, with strong growth in enterprise, data center, and severe duty markets, and net income of $1.1 million ($0.12/share), reversing a prior year net loss.

• Gross profit increased 42.4% year-over-year to $7.6 million, driven by higher volumes and manufacturing leverage.

• Six-month net sales increased 16.1% to $38.6 million, gross profit up 30.1% to $13.0 million, and net income of $657,000, compared to a $1.8 million loss in the prior year.

• Sales order backlog and forward load reached $13.3 million at quarter-end, up 27% from January 2026 and 82% from October 2025.

• Strong performance attributed to higher sales volumes, improved operating leverage, and increased international sales.

Financial highlights

• Q2 net sales: $22.2 million, up 26.6% year-over-year and 35.2% sequentially; first half FY2026 net sales: $38.6 million, up 16.1% year-over-year.

• Q2 gross profit: $7.6 million, up 42.4% year-over-year; gross margin rose to 34.2% from 30.4%.

• First half gross profit: $13.0 million, up 30.1% year-over-year; gross margin at 33.5%.

• Q2 SG&A expenses: $6.3 million, up 9.2% year-over-year, but as a percentage of sales, fell to 28.2% from 32.7%.

• Q2 net income: $1.1 million ($0.12/share) vs. net loss of $698,000 ($0.09/share) last year; first half net income: $657,000 ($0.07/share) vs. net loss of $1.8 million ($0.23/share) last year.

• Operating income for Q2 was $1.3 million, up from a $429,000 loss; six-month operating income was $1.1 million, up from a $1.3 million loss.

• Cash at period end was $146,000, down from $238,000 at prior year-end; working capital increased to $17.1 million.

Outlook and guidance

• Management expects continued market improvements, especially in enterprise, data center, and severe duty markets.

• Sales order backlog increased to $13.3 million at Q2 end, up from $10.4 million at Q1 and $7.3 million at prior year-end.

• Seasonality expected, with higher sales in the second half of the fiscal year.

• Confident in ability to capitalize on momentum and growth opportunities for the remainder of FY2026.

• Management believes cash flow from operations and existing credit facilities will fund operations for at least the next 12 months.